Taylor report recommends review of cash-in-hand

Cash-in-hand payments should be replaced with technology driven alternatives in the hopes of collecting up to £6 billion more in tax – this is the conclusion of a Government-commissioned review conducted by Matthew Taylor, head of the think-tank the Royal Society of Arts.

The 116-page report, entitled Taylor Review of Modern Work Practices, was commissioned to explore modern employment practices in the UK, in particular how the country should adapt to the growing “gig economy”.

Reflecting on cash-in-hand, Mr Taylor said: “Technology can make life easier and what we are suggesting is, as we move more to a cashless economy, then when, for example, your window cleaner charges you, you can pay cashlessly.

“At the same time, their tax can be paid as we as employees pay through PAYE, which makes their life easier. They might at the same time be making a contribution to their pension or to insure themselves for sickness.”

Within his report he also recommends:

Creating a new category of employee called a “dependent contractor”, who should be given extra protections, but should be offered the flexibility of a self-employed worker.

Closing the gap between the rates of National Insurance for employed and self-employed people.

Following the release of the report Downing Street said it would not introduce an outright ban on cash-in-hand payments, but said it would back the idea of digital payment systems that could be linked to pensions and other benefits.

The Prime Minister said that the Government would review the report and see if it could implement some of its changes in future, but emphasised that she would need the support of the rest of Parliament to do so.